The Panama Canal Authority will reduce the number of daily ship transits from 36 to 32 starting September 15 due to low rainfall caused by a strong El Niño event, exacerbated by climate change. The measures aim to preserve service reliability and water resources.
The reduction in Panama Canal transits will likely cause delays and increase shipping costs for goods traveling between the Atlantic and Pacific oceans, impacting global supply chains and potentially contributing to inflation.
The Panama Canal Authority (ACP) has announced a significant reduction in the number of vessels that will be permitted to transit the vital waterway, citing critically low water levels due to the El Niño weather pattern. Beginning September 15, the canal will allow only 32 ships per day, down from the current 36.
The ACP stated that these measures are necessary to preserve service reliability and safeguard water resources, despite the arrival of the rainy season and existing water-saving initiatives. The authority indicated that further action is required to ensure the long-term sustainability of transit operations.
El Niño, a periodic warming of sea surface temperatures, is known to affect global weather systems, and this year's event is anticipated to be particularly strong, with its impacts potentially intensified by climate change. The canal, which facilitates passage between the Atlantic and Pacific oceans, is used by approximately 14,000 ships annually and generates about $3 billion in revenue for Panama.
This reduction in traffic comes as the shipping industry is already contending with disruptions, including those caused by the conflict in the Middle East impacting the Strait of Hormuz.